State pushes housing lifeline

Ad campaign says 'Mortgage Late? Don't Wait!'

May 07, 2008|By Laura Smitherman | Laura Smitherman,Sun reporter

With many homeowners facing foreclosure but not seeking help, state officials are launching an advertising campaign on buses and billboards and through print and radio spots to get their attention with the slogan: "Mortgage Late? Don't Wait!"

"Help may well be available, but you have to pick up the phone and ask," Gov. Martin O'Malley said at a news conference to announce the campaign yesterday. "About 50 percent of people who go through foreclosure never pick up the phone to call and ask for help. Oftentimes they are too ashamed. Oftentimes they simply abandon the home."

The rate of foreclosures is expected to rise over the next year, and state and federal officials have scrambled to respond. O'Malley, a Democrat, helped to push through a package of bills during the General Assembly session earlier this year to build more consumer protections into the lending and foreclosure process. His administration also has crafted several refinance and short-term loan programs to help borrowers who are behind on their mortgage payments.

State officials said yesterday that the next step is to ensure that homeowners know where to turn.

The ads direct callers to a telephone hot line through which residents can be connected with nonprofit housing counselors; a similar ad campaign has been running in Baltimore City in recent weeks.

The counselors can help them negotiate with loan servicers and lenders for more sustainable mortgage payments or help them pursue other options to avoid foreclosure. The state campaign's phone number is 1-877-462-7555.

Efforts to forestall foreclosure have had mixed success in reaching homeowners. According to the State Foreclosure Prevention Working Group, composed of state attorneys general and banking regulators, seven out of 10 borrowers who are seriously delinquent on payments are not on track to work out a solution to avoid foreclosure.

The number of borrowers in the loss-mitigation process has increased, according to the group's report this year, but that increase has been matched by an increasing level of past-due loans.

More than 13,000 homeowners in Maryland were in some stage of foreclosure at the end of last year, the Mortgage Bankers Association reported, and that number is expected to rise as more adjustable-rate mortgages reset to higher payments. Housing Secretary Raymond A. Skinner said homeowners need to act as soon as possible.

"The longer you wait, the more difficult it is to have a positive outcome," he said.

The advertising campaign will include signs in hundreds of Maryland Transit Administration buses and light rail cars, which are expected to be seen by more than 240,000 riders a day. Radio spots in English and Spanish will run on stations in the Baltimore and Washington metropolitan areas.

Also in recent months, the state has mailed 680,000 postcards to homeowners in ZIP codes hit hardest by foreclosures.

Meanwhile, Baltimore City is planning mortgage workshops to be held in public libraries starting later this month to help homeowners navigate the foreclosure process and put them in touch with housing counselors.

Mary Klipa, a Dundalk resident who attended the event yesterday, said she found herself choosing between paying her home loan and buying food for her family when her adjustable-rate mortgage reset. She was able to avoid foreclosure and get into an affordable loan after she heard about a refinance program through the state and called for information.

"I crossed my fingers, and I did make that life-changing phone call," Klipa said.